Calling on the Government to do more to facilitate family-based welfare, the report's author, Ryan Shorthouse, said: "We tend to think of the 'bank of mum and dad' as being about better-off families helping their children get on the housing ladder or pay for a wedding.

"But our research reveals that about half of families on low incomes receive regular financial and practical support, typically helping them to pay for everyday items, keep out of debt and make ends meet.

"The impact of such transfers is generally very positive, both for the donor and recipient. But not receiving support from the wider family can cause deprivation and isolation. When thinking about poverty, policymakers need to be more aware of this."

The think tank recommends the introduction of government-backed tax-efficient "Family Trust Funds" to help family members across generations to invest in a tax-efficient trust managed by a representative from each household.

Decisions on distribution would be determined by the trustees, and families would be prompted to enrol on receipt of child benefit.

Mr Shorthouse said: "With the recovery slow and public spending still under pressure, policymakers shouldn't solely focus on wages and benefits to boost living standards and reduce poverty.

"Family is a vital backstop for people on low-incomes, and practical measures like a government-backed trust fund could make a real difference.

"It's time for policymakers to be more creative and look at ways to enable people to untap the resources of their wider family."